(The terms Arbeitnehmerleihe and Arbeitnehmerüberlassung are used synonymously.) Arrangement based on a contract for the supply of labour concluded between one enterprise (the lessor) and another enterprise (the lessee). Under this contract, the lessor puts one of its employees at the lessee's disposal for a specified period for the purpose of performing specified work. During the period of time concerned the lessee is able to use the employee temporarily hired out in this way (Leiharbeitnehmer) for such work on the same basis as its own employees, but in return must give the lessor an appropriate consideration (usually the agreed sum of money). In legal terms a contractual relationship exists only between the lessor and lessee and between the lessor and the employee hired out.

The hiring-out of labour is permitted in principle under the Hiring-Out of Labour Act (Arbeitskräfteüberlassungsgesetz). Those concerned must, however, observe a number of legal requirements whose chief purpose is to protect such employees from being exploited. Employees may not be hired out without their consent (in cases where the lessor practises the habitual hiring-out of labour as a business, the employee's generalized consent may be given at the outset rather than on every occasion); such use of temporary employees must not adversely affect pay and employment conditions or threaten jobs in the user establishment; the lessee is deemed to be the employer for the purposes of the legal provisions on employee protection as regards both safety and health protection at work and protection regulating the employment of particular groups; and for the duration of the employment concerned the obligations inherent in the duty of care also rest on the lessee (joint and several liability). To carry on the hiring-out of labour as a business (i.e. with the intention of practising it habitually for profit-making purposes), lessors must obtain an official licence which is granted only if they furnish proof of their competence and personal integrity. Special legal provisions include the stipulation that a basic contract must be concluded between lessor and employee, specifying the employee's pay and the intervals at which it is to be paid, holiday entitlements, hours to be worked, periods of notice required and the countries in which the employee is to be employed. The employer must also be given a written statement of terms and conditions. Clauses limiting entitlement to pay to the period of employment with a user enterprise are prohibited, however, and the law establishes that the employee's entitlement to pay continues, in accordance with the agreed working hours, even during periods when no employment can be provided. During the period of employment in a lessee's establishment, the level of pay must be based on the collectively agreed pay due to comparable employees of the lessee for doing comparable work. And the lessee bears full liability as guarantor for all pay due to the employee for the period of employment in its establishment.

Irrespective of whether it takes place in the context of a business, the hiring-out of labour from abroad for employment in Austria or from Austria for employment abroad is subject to additional restrictions and preconditions.

On the other hand, the above regulations do not apply in certain cases including the public service or between member companies within a group.

Please note: the European industrial relations glossaries were compiled between 1991 and 2003 and are not updated. For current material see the European industrial relations dictionary.